NEW YORK, Sept. 23, 2020 (GLOBE NEWSWIRE) — via NetworkWire – Sugarmade, Inc. (OTC: SGMD) (“Sugarmade” or the “Company”) is excited to announce the signing of a nonbinding Letter of Intent (the “LOI”) with LMK Capital, LLC (“LMK”). Sugarmade and LMK have agreed to work toward the negotiation of a definitive lease agreement for access to as much as 40 acres of property in Northern California. The Company intends to use 5 acres of the property to operate a regulated and licensed cannabis cultivation business. Jimmy Chan, Sugarmade’s chairman of the board, chief executive officer, chief financial officer and majority stockholder, is also majority owner of LMK.
“We continue to take strategic steps toward broadening our exposure to the growth trend in the cannabis market,” Chan commented. “We see this as a secular growth trend that is still very much in its early innings. And we believe our positioning in California puts us close to the current epicenter of that trend. In addition, we are committed to increasing verticalization of operations as a context for our investment in the BudCars cannabis delivery business. If we are able to finalize the lease, we expect that this could drive a substantial widening of margins on the growing volume of BudCars sales.”
Sugarmade has a 40% stake in BudCars, with the option to acquire an additional 30%. Because BudCars is a rapidly growing distribution channel, Sugarmade believes it will have a direct channel in the marketplace to establish its own branded cannabis product line, which can then be distributed through multiple distribution partners at premium pricing.
Sugarmade’s in-house analysis suggests that control over 5 acres of this property carries the potential to yield as much as 8,000 pounds (or more than 3,628,700 grams) of cannabis flower per year.
The LOI is nonbinding on the parties and there can be no assurance the parties will enter into a definitive lease agreement.
About Sugarmade, Inc.
Sugarmade, Inc. (OTC: SGMD) is involved in the following two main business areas: (i) the supply of consumable products to the quick service restaurant subsector of the restaurant industry, and as an importer of nonmedical personal protection equipment to business and consumers, and (ii) investment in the Budcars licensed cannabis delivery service brand (“Budcars” or the “Budcars Brand”) and joint ownership and operation of Budcar’s first operating location in Sacramento, California. For more information, visit www.Sugarmade.com.
FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements within the meaning of the federal securities laws that involve risks and uncertainties. Forward-looking statements include statements the Company makes concerning plans, objectives, goals, strategies, future events, future revenues or performance, capital expenditures, financing needs and other information that is not historical information. When used herein, the words “estimates,” “expects,” “anticipates,” “projects,” “forecasts,” “plans,” “intends,” “believes,” “foresees,” “seeks,” “likely,” “may,” “might,” “will,” “should,” “goal,” “target” or “intends” and variations of these words or similar expressions (or the negative versions of any such words) are intended to identify forward-looking statements. All forward-looking statements are based upon information available to the Company on the date hereof. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s control, that could cause actual results to differ materially from the results discussed in the forward-looking statements, including, among other things, the matters discussed herein. All forward-looking statements apply only as of the date of this press release and are expressly qualified in their entirety by the cautionary statements included herein. The Company undertakes no obligation to publicly update or revise forward-looking statements to reflect events or circumstances after the date made or to reflect the occurrence of unanticipated events, except as required by law.